Second-quarter profits rose at both SemGroup Corp. and Rose Rock Midstream LP as demand for crude oil pipeline and terminal services grew rapidly across the Mid-Continent, the Tulsa-based energy infrastructure company reported Wednesday.
SemGroup's net income totaled $5.147 million, compared with a $1.4 million loss in last year's second quarter. Rose Rock earned $5.126 million, down from the first quarter's $7.8 million but slightly higher than in 2011's comparable period.
"Things are progressing well at both SemGroup and Rose Rock," CEO Norm Szydlowski said in a conference call with analysts. "We've come a long way in a short time, and we think the future looks just as promising."
He added that SemGroup is well-positioned because it owns infrastructure in areas where North American oil production is growing, such as the Bakken Shale and Denver-Julesberg Basin. The company's services are in demand by producers who need to move their oil from the wellhead to terminals and refineries.
Crude transport volumes increased by 13 percent on SemGroup's WhiteCliffs Pipeline from Colorado to Cushing. Rose Rock also benefitted by completing an addition 1.95 million barrels worth of crude storage capacity at the Cushing hub.
SemGroup owns and operates transport and storage services for crude oil, natural gas, residual fuels, refined products and asphalt in the U.S., United Kingdom and Mexico. The company dropped down its Cushing oil hub assets and some pipelines to form Rose Rock and take it public last year.
SemGroup's growth projects include the Glass Mountain Pipeline, which will bring crude oil from the growing and liquids-rich Mississippi Lime play of northern Oklahoma into the Cushing storage hub. The pipeline, which may be completed by fall 2013, will be a joint venture between Chesapeake Energy Corp., Gavillon LLC and SemGroup.
The 37-mile Wattenburg Oil Trunkline will be built by SemGroup to move Noble Energy Inc.'s production from wellheads in the Denver-Julesberg Basin of Colorado. Completion is expected in the second half of 2013, according to reports.
SemGroup's business model will focus on building growth projects, such as pipelines and processing plants, then selling them down to Rose Rock, in which SemGroup owns a controlling stake and cash distribution rights.
SemGroup Corp. earnings
SemGroup Corp. earnings
|
2012 2Q |
2011 2Q |
2012 Half-year |
2011 Half-year |
Pct. Change |
| Revenue |
$334.2M |
$344.2M |
$651.8M |
$751.2 |
-13.2% |
| Net income (loss) |
$5.1M |
($12.3M) |
$3.77M |
($12.3M) |
N/A % |
| Net per share (loss) |
$0.12 |
($0.30) |
$0.09 |
($0.29) |
N/A % |
Rose Rock Midstream LP earnings
|
2012 2Q |
2011 2Q |
2012 Half-year |
2011 Half-year |
Pct. Change |
| Revenue |
$157.4M |
$110.7M |
$337.1M |
$194.5M |
73.3% |
| Net income |
$5.1M |
$4.97M |
$12.9M |
$12.6M |
2.4 % |
| Net per share |
$0.30 |
N/A |
$0.75 |
N/A |
N/A |
* SemGroup took Rose Rock public in December 2011
Rod Walton 918-581-8457
rod.walton@tulsaworld.com
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